Accountancy, asked by nagendra9425, 1 year ago

Valuation of closing stock at actual cost price or market price which ever is lower is an example of accounting convention

Answers

Answered by Anonymous
1
\huge{Answer \ :-}

● The convention of conservation also known as doctorine of prudence, is a policy of anticipating future losses but not future gains. This policy tends to understate rather than overstate net assets and net income, and therefore leads companies to loss. When given a choice between several outcomes where the probabilities of occurance are equally likely , you should recognise that transaction resulting in lower amount of profit or deferral of profit.

========
Thanks !!
Similar questions